Report: Microsoft to close in-game advertising company Massive

In-game advertising may be a growing business, but it looks like Microsoft's …

Massive was Microsoft's push into video game advertising and, since we live in an ad-filled world and games seek to mimic that reality, it seemed like a good fit. According to a report by Media Week however, the company has long been troubled, and will soon be shutting its doors.

The problem? Microsoft would rather advertise in Xbox Live, where it doesn't have to split the profits with publishers. EA recently pulled its business from Massive in order to sell ads internally. It's not that you will be seeing less advertising in games, it just seems as if those making large bets on in-game ads would simply rather keep larger cuts for themselves.

"Video games are an active, engaged, 'lean-forward' entertainment experience," Massive GM JJ Richards told Ars in 2009, making the case for advertising in video games. "Games in Massive's network contain four to five minutes of advertising or less per hour. Contrast that with an hour of television where consumers are likely to be exposed to at least 12 minutes of interruptive advertising."

Ads in games are a controversial subject, but with the price of development swelling and the price of software remaining stagnant or even dropping, it's one way for developers and publishers to add to the bottom line. In-game advertising will continue, but Microsoft isn't going to find itself in a position to dominate the market.